Speaking on the sidelines of public hearings held by the National Assembly's Trade and Industry Portfolio Committee on the Co-operatives Second Amendment Bill, Thabethe said the co-operatives development agency proposed under the amendment bill would go some way to address the lack of business skills found among many members of co-operatives.
The performance up to now of co-operatives locally had been mixed, but the new bill aimed to address some of the challenges that these entities face locally, by among other things, the setting up of the development agency, as well as a co-operatives advisory council and a tribunal to adjudicate on disputes that arise between or from members of co-operatives.
As an example of the kind of disputes the tribunal would handle, Thabethe singled out a co-operative which had accessed the department's co-operative incentive scheme grant to buy a vehicle, which was kept at the home of one of the members who had a garage and a driver's license.
However, when this member passed away his family wanted to claim the car as part of his estate and the department had to take the issue to court to retrieve the car.
It was crucial, said Thabethe, that co-operatives look at the entire value-chain, of a certain product or service, if the country is to build successful co-operatives.
For example, in textiles manufacturing, co-operatives could carry out everything from the picking of cotton to the export of finished clothing.
She said in countries where co-operatives had been successful, such as Kenya, Argentina and New Zealand, it had taken years of support to boost the sustainability of these entities.
The new bill aims to lessen the regulatory burden that co-operatives - particularly primary co-operatives - have to face.
But in a presentation to the Trade and Industry Portfolio Committee today, Saica project director of governance and non-IFRS reporting, Juanita Steenekamp, cautioned that the many current accounting procedures proposed in the amendment bill may raise the regulatory burden.
Steenekamp said the bill's different definitions for what constituted an audit, compared to the Auditing Professions Act, or what constituted an independent review compared to the Companies Act, could confuse accountants, auditors and co-operative members.
She called for the bill's definition for audits to be aligned with the Companies Acts, which allocates a point each for every employee, every R1 million in turnover, every R1 million in third-party liabilities and every beneficial interest holder, when determining whether or not a company is required to undergo an audit.
Sactwu research officer Simon Eppel, in a joint presentation with the National Union of Metalworkers SA (Numsa), was concerned over the increasing use of so-called bogus-co-operatives - where employers use co-operatives to side-step labour legislation.
Eppel said the 2005 Co-operatives Act provided a loophole, in that members of the co-operatives are not regarded as employees and therefore don't fall under labour legislation.
He said many companies moved employees into co-operatives to avoid having to abide by labour legislation, while retaining ownership of any machinery and effectively outsourcing work to them.
In February last year the Department of Labour was aware of 100 bogus co-operatives - up from the seven reported bogus co-operatives in 2007, he said, adding that the problem was particularly prevalent in the clothing sector.
To close the loophole in the current Co-operatives Act, he called for the all members of co-operatives to be defined in Section 73 of the act as employees, and proposed that the process to exempt members as workers be handled by bargaining councils and the Minister of Labour.
He also proposed the exclusion of juristic persons (such as farms, wine producers and other businesses) from the most basic primary co-operatives, in favour of natural persons.
